Tata Steel Limited executes definitive agreemnent to acquire equity of Odisha based Brahmani River Pellets Ltd

The transaction is based on an enterprise value of BRPL of Rs. 900 crores plus closing adjustments and is subject to completion of certain condition precedents including regulatory approvals. The funding for the acquisition will be done from internal cash flows of Tata Steel.

BRPL was originally established by MIG (MIG was formed on demerger from Stemcor Group of Companies as part of a UK court-approved restructuring in 2015), which continues to hold a significant stake in BRPL through its shareholding in AMTC. BRPL owns a 4 mtpa Pellet plant in Jajpur, Odisha and 4.7mtpa iron ore beneficiation plant in Barbil, Odisha connected through a ~220 KM underground slurry pipeline.

Koushik Chatterjee, Group Executive Director (Finance & Corporate) and member of the Tata Steel Board said, “The location of the BRPL assets makes this very strategic to Tata Steel especially to our Kalinganagar operations and has significant operating synergies to make our Kalinganagar plant even more competitive for the future. The iron ore from our captive mine in the Joda and Khondbond region will get transferred in future through the slurry pipeline and reduce freight costs significantly apart from the 4 mtpa pellet plant & other infrastructure which will enhance the operating efficiency and reduce costs of blast furnace operations in Kalinganagar. To build a similar facility would have taken significant time and costs and therefore, this acquisition is very timely as we are looking to ramp up the capacity of the Phase 1 at Kalinganagar. This is also a demonstration of our commitment to the State and people of Odisha.”